Editorial: Financial regulations must get finished

When it comes to better regulating banks that took the country into a massive financial crisis and deep recession, the federal government triumphantly marched down the field, only to punt when it got near the goal line.

This is completely unacceptable - and it's dangerous for the country.

The government, and the public, must have longer memories. They must push through changes to end the premise that any bank is "too big to fail." Otherwise, these mega-institutions will continue to grow and practice "no-risk capitalism," reaping all the benefits during the flush times but, for the sake of halting another financial collapse, getting a government bailout when things go sour.

President Barack Obama says the nation's top financial regulators need to finish writing rules designed to prevent a recurrence of the 2008 financial crisis, and he is correct. But the Obama administration and Congress should get blamed as well for giving regulators too long to finish their work and for allowing bankers too much wiggle room under the Dodd-Frank regulations, called that after their Democratic sponsors, U.S. Rep. Barney Frank of Massachusetts and Sen. Christopher Dodd of Connecticut. In fact, in some cases, banks are bigger than they were before the financial collapse.

Yes, there has been progress in other ways. A council of regulators has been set up to look for risks across the finance markets. A Consumer Financial Protection Bureau has been created to ensure there is transparency and easy-to-understand language in mortgage deals and credit card agreements. And it was recently announced that eight of the largest U.S. banks will have to demonstrate they're on stronger financial footing than previous standards, thus reducing the threat they pose to the entire system.

But, by now, rules also were supposed to be in place stopping banks from entering into certain kinds of speculative, high-risk trading that were part of the reason for the financial meltdown. Those rules are still nowhere to be found. They are intended to restrict banks from engaging in proprietary trading that does not benefit customers.

Meanwhile, big banks have not negotiated in good faith with people trapped in home loans they cannot afford and who are facing foreclosure, in part, as a result of the financial collapse and the utter wreck these institutions made of the mortgage securities system.

Most people recognize the economy has not healed, but they also should remember the damage that was done and some of the root causes of the collapse. Vigilance is required, both by the public and by federal regulators who have been given a job to do and must finish the task.

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Editorial: Financial regulations must get finished

When it comes to better regulating banks that took the country into a massive financial crisis and deep recession, the federal government triumphantly marched down the field, only to punt when it got